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Income Increase and Moving to a Better Neighbourhood: An Enquiry into Ethnic Differences in Finland

Author

Listed:
  • Vaalavuo, Maria

    (National Institute for Health and Welfare)

  • van Ham, Maarten

    (Delft University of Technology)

  • Kauppinen, Timo M.

    (National Institute for Health and Welfare)

Abstract

Concentration to disadvantaged neighbourhoods may hinder immigrants' opportunities for social integration, so equal chances of translating available economic resources into mobility to less disadvantaged neighbourhoods are important. This paper adds to existing research on exits from poor neighbourhoods by focusing on the effects of income increase on residential mobility. We analyse intra-urban residential mobility from low-income neighbourhoods into non-low-income neighbourhoods among immigrants and native-born residents in three urban regions in Finland. We use longitudinal register data for the 2004–2014 period for the full Finnish population, allowing a dynamic analysis of changes in income and neighbourhood of residence. Based on multinomial logit modelling of migration outcomes, we found that an increase in income is associated with moving both to low-income and non-low-income areas even when controlling for initial income level. Upward income mobility was connected to exit from low-income areas in a quite similar way among immigrants and native-born Finns. The findings suggest that policies e.g. improving the labour market opportunities of immigrants are effective in reduction of residential segregation. However, we were not able to completely explain the differences between native-born Finns and immigrants in moving patterns. The differences between the cities were opposite for immigrants and native-born Finns, corresponding to differences in immigration history and levels of ethnic segregation. Therefore, the local context matters for spatial integration outcomes.

Suggested Citation

  • Vaalavuo, Maria & van Ham, Maarten & Kauppinen, Timo M., 2017. "Income Increase and Moving to a Better Neighbourhood: An Enquiry into Ethnic Differences in Finland," IZA Discussion Papers 11076, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp11076
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    References listed on IDEAS

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    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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